Péter Zoltán
29/01/2025 22:56
Perhaps it is because agriculture, animal husbandry, and the feed industry are now facing a real challenge, which underscores the need for the transfer of modern and efficient feeding knowledge, the construction of modern feed production capacities, and complex feed industry services.
And of course, perhaps also because Kazakh and Hungarian thinking are not far from each other, as supported by the common Kipchak past.
The 28 years of feed industry activity and development of the UBM Group, which comprises 16 companies, have enabled us to think about complex development projects and programmes. The presentation of our current activity can support understanding this dynamic direction of development and our medium-term development strategy.
UBM is a Hungarian-owned leading feed industry company in Hungary and a significant player in the Central European region in feed raw material trading, compound feed production, and pig production, registered on the Hungarian Stock Exchange market. In the last business year, we achieved 545 million USD consolidated sales revenue, generated by 408 full-time dedicated employees. We sold 1.7 million metric tons of feed raw materials and produced 800 thousand tons of compound feed. We sold our products to 19 countries, with 54% of our sales revenue coming from export markets. We have six factories in Hungary and one each in Slovakia, Romania, and Serbia.
Our medium-term strategic plan is to build one new feed mill in Romania and Serbia and to start a complex investment project in Kazakhstan, which is a new market for us.
We carefully studied the opportunities in many emerging markets, and we decided that, based on the favourable information, we could explore the possibilities of Kazakh agriculture and the feed industry more thoroughly. From February 2024, we studied the economic situation in Kazakhstan, collected figures on and actors in Kazakh animal husbandry and feed production, and, of course, met many companies to look for potential joint venture partners. We visited nine akimats, searching for suitable locations for investments and finding appropriate business partners. In addition to getting to know the areas and opportunities, we also sought the support and cooperation of Kazakh and Hungarian government bodies and institutions, as well as business start-up support from the Kazakh akimats.
Based on all the information and impressions, the UBM owners decided to start a complex investment project in Kazakhstan, although we had originally planned to build “only” a feed mill. Now we plan a 62 million USD investment, which will create 180 new jobs during the 2025-2028 investment period. This programme consists of building one premix factory with 30,000 tons annual production capacity, a modern laboratory and training centre in the Almaty region with a total 27.5 million USD investment, and three feed mills, each with a 100,000-ton production capacity per annum and 11.5 million USD investment, in the Kostanay, Aqmola, and Turkestan regions.
UBM Group's international feed production and feed raw material trade knowledge will be provided in a complex investment package and concept, offering Kazakh feed industry players expertise in feed raw materials and optimising animal nutrition. The modern and automated facilities will offer a product range for intensive and semi-intensive animal husbandry, all utilisation, ages of animals, and forms of compound feed, such as mash, pellet, or crumbled. The complete service package we plan to provide for our partners includes laboratory services, feed formulation, nutritional and direct cost optimisation, technical and professional services, and consultancy, as well as central training courses. Of course, we will be ready to support our customers’ quality assurance and recipe management to find the economic optimum for their farming.
Is all this a realistic and feasible plan? The answer is clearly yes, since we have decided on a thoroughly prepared and considered project, supported by the Kazakh and Hungarian governments, and we have already found suitable Kazakh partners with whom we can certainly realise this large-scale vision.
Do we have to face serious challenges? Yes, of course, because despite the many common features and historical links, there are significant differences in the business approach and adherence to accurate schedules. However, we believe that all these challenges can be overcome if we build appropriate human relations based on mutual respect and interests. We trust that, Inshallah, after a few years, we will be able to report again on the results of a very successful, mutually beneficial project.
The author is Kazakh Investment Director at UBM Group